Former Vanderbilt University vice chancellor for health affairs Harry Jacobson is alleged to have helped finance a house-flipping Ponzi scheme, according to a lawsuit filed in Davidson County Chancery Court on Wednesday.
The complaint filed by Greg Sturgeon alleges that Kirk Leipzig, a local real estate investor, promised him a return on investment for contributing $60,000 to an East Nashville house flip. Leipzig, the manager of Home Equity Asset Partners, was featured in a 2008 Forbes article that touted his opportunistic real estate investments on foreclosed homes.
Sturgeon expected a healthy return for his financial contribution to the rehab and flip of a home at 1423 Stratton Ave. in a burgeoning East Nashville neighborhood. Leipzig succeeded, selling the home last June for $457,000 after purchasing it for $135,000, according to Davidson County property records.
But the lawsuit alleges that Leipzig first quitclaimed the property to HEAP without Sturgeon's knowledge and only returned about $40,000 of Sturgeon's initial investment.
The suit claims that Jacobson, whose son Andrew works for HEAP, was helping to finance the scheme and “benefited from the misappropriation of Mr. Sturgeon's money as it allowed [Harry Jacobson, Leipzig and HEAP] to pull equity out of the Stratton property.”
Sturgeon is asking for $1 million in punitive damages to “punish and deter Defendant Leipzig and others ... from such future fraudulent and unfair conduct.”
Efforts Thursday to reach Leipzig and Jacobson, who is pictured here, were unsuccessful. Sturgeon's suit is available here.
It’s not the first time Leipzig has been sued over his real estate dealings. Earlier this year, a Manchester, Tenn., couple who cashed in a 401(k) to contribute $150,000 to a Green Hills house flip claimed Leipzig told them the money was reinvested into a $1.8 million Hillsboro Pike home. Property records show that Andrew Jacobson purchased that house for $600,000 from a bank in 2011.
Leipzig eventually returned about $115,000 to the couple and other family members. In addition to asking for the remaining $35,000, the family also has filed a notice of a lien against the Hillsboro Pike home, claiming they have a monetary interest in the property.
Two banks also sued Leipzig for failing to repay loans in 2011 and 2012, respectively. Sturgeon's lawsuit is the only one that mentions Jacobson's involvement with Sturgeon.
Jacobson resigned from the top spot at VUMC in June 2009. Since that time, he has been involved in several medical, investment and technology ventures. He also has named Belmont University's Massey 2013 Executive-in-Residence to help guide that school's new health care MBA program.